Every business has risk. All types of risk. It’s how you manage risk that makes your business successful.
Every employee and dependent covered under your health plan represents some risk, and with risk comes potential cost. The greater the risk – the greater the potential cost. How are you managing the risk of your employees? Some of the risk can be avoided, some can be eliminated, some can be mitigated, and some risk may not be managed at all. Some risk comes as a surprise. It just depends on the programs you have.
There have been lots of programs developed in recent years that have successfully managed risk for an employer. But, in order to manage the risk, you first have to identify it. How are you identifying people and situations with high risk? How are you managing those with low risks from becoming high risk? Every group has 3 types of risk – those who are well (no issues), those who have lifestyle risks, and those who have chronic conditions and are high risk if they are not managed properly.
How are you managing high-cost medical providers? Those providers whose charges are egregious. Recent example: an employee was to go into the hospital for an outpatient procedure – right shoulder arthroscopic repair. The hospital wanted to charge $94,000! Then they said that they would take $78,000 cash. The Medicare rate plus 50% was $7,800. There isn’t a PPO discount large enough to get that price down.
How are you managing the cost of high-end Specialty Drugs? Example: Humira costs ~$70,000 per year! It’s become a very popular drug in recent years.
I have vetted many programs over the years and here is what you can do to manage all of your risks: Note: There are many programs out there, so you need to know what questions to ask.
- Implement and utilize an effective Wellness, Lifestyle Management and Disease Management program. Keep the well, well and manage the rest.
- Implement specialty medical programs such as Diabetes Management and Oncology Management? The costs associated with these conditions, if left unmanaged are extraordinary.
- Implement a REAL Specialty Drug program independent of your Pharmacy Benefit Manager (PBM). PBMs have their own specialty pharmacy but you won’t save a ton of money.
- Utilize an effective Claims Administrator to pay claims – one that is a good steward of your money. There are many out there that don’t care about spending YOUR money.
- Implement a Reference Based Pricing program to control the providers who charge outrageous prices. There are ones that have been doing this for a long time and others who are startups.
- Utilize a PBM that doesn’t utilize spread pricing and doesn’t keep some or all of the rebates.
As I said, I’ve done the vetting of these programs for you. You can do the homework, or you can read my book – “You Don’t Know What You Don’t Know,” or you can reach out to me by phone or email and I can help.